Lawmakers pass Neb. wind energy incentive bill

LINCOLN, Neb. (AP) _ A bill that would use sales tax exemptions to attract wind farms to Nebraska won final approval Wednesday from lawmakers.

Senators passed the measure in an effort to increase wind-energy production in Nebraska, which is trailing Iowa, South Dakota, Wyoming, Colorado and Kansas. Nebraska ranks among the top states nationally in its potential to generate wind power, but 26th in what it can produce right now.

Sen. Ken Haar of Malcolm said Nebraska officials are still "tying our shoes'' for a wind-energy race that already has started.

"If we don't get in this race quickly, the race is going to be over,'' Haar said. "All of the infrastructure, all of the manufacturing will be in place in the other states, and we're going to be left blowing in the wind.''

Sen. Steve Lathrop of Omaha, the lead sponsor, has said the bill is designed to keep Nebraska competitive with other high-wind states that have offered tax incentives. Nebraska currently charges a sales tax on all equipment and materials used in wind-energy projects.

The vote also came as a Kansas-based company, TradeWind Energy, considers developing a wind farm in Dixon County, near the Iowa and South Dakota border.

Lawmakers also rejected a proposed amendment that would have required companies to use a certain amount of Nebraska-made materials when constructing wind farms. Opponents of the amendment argued that the requirement would make it harder for wind companies to create wind farms in Nebraska, because products made in-state might cost more than those produced elsewhere.

Sen. Jim Smith of Papillion said wind energy in Nebraska, a public power state, could increase the cost for ratepayers. Smith said half of the renewable energy in Iowa is owned by a private utility, the investor-owned MidAmerican Energy.

"Renewables are necessary in a balanced energy portfolio in our state,'' Smith said. "But I'm not a huge fan of renewables or wind if it needlessly increases the cost to Nebraskans without the reliability that we need.''

Republican Gov. Dave Heineman has criticized the bill, saying it extends tax breaks to out-of-state companies. Lathrop, a Democrat, is considering a run for governor in the 2014 election.

The bill would also repeal Omaha's ability to impose a half-cent increase in its local sales tax, based on a law that was approved last year. The wording was added to the bill as part of a compromise with Sen. Ernie Chambers, of Omaha, who vigorously opposed the sales-tax law.